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Ending Poverty In America

I watched the Democratic National Committee debate, which was held before their recent election for the new Chair. The old Chair was forced out by scandal because she corruptly passed the debate questions to Hillary so she could appear smarter than Trump.

(Curiously, not one candidate for Chair had one word to say about that ugly recent history. No mea culpas. No acknowledgement of the damage that their unethical actions had done to their brand. No attempt to ask for forgiveness. This is a foolish move. America is a very forgiving nation, but you have to ask for it. Heck, we have had TV mega-preachers caught with an arm-full of hookers and a nose-full of blow. Those jokers simply confessed that they were “weak sinners”, asked to be forgiven, did two weeks “retreat”, spoke deeply and meaningfully with their religious advisors and kept on preaching. To do that, though, you have to confess and ask for forgiveness, and foolishly the Democrats never did … but I digress …)

I was also amused by the fact that most of the hopefuls spoke of one thing and one thing only—their hatred of Trump. Each speaker tried to outdo the last at being the most anti-Trumpiest candidate of all, the quintessential Trump-hater. By the end of the evening, there was nothing even vaguely Trumpish which had not been roundly and severely denounced as being evil and downright-unAmerican.

The atmosphere was like what I always imagined as a teenager when I read George Orwell’s 1984, about the “Two Minutes Hate”. Here’s the updated quote, viz:

The program of the Two Minutes Hate varied from day to day, but there was none in which Goldstein Trump was not the principal figure. He was the primal traitor, the earliest defiler of the Party’s purity. All subsequent crimes against
the Party, all treacheries, acts of sabotage, heresies, deviations,
sprang directly out of his teaching. Somewhere or other he was still
alive and hatching his conspiracies: perhaps somewhere beyond the sea,
under the protection of his foreign paymasters, perhaps even–so it was
occasionally rumoured–in some hiding-place in Oceania Russia itself.

At times, I feared that the amount of virtue in the room would overcome the air conditioning and lead to random outbreaks of auto-adulation. As they say, it’s not the heat … it’s the humility …

I was amazed at the vitriol, the bitterness, the hatred, the bile of the hopeful candidates, but the bigger the accusation, the more the debate audience loved it, whooping and hollering at each accusation. Here’s Orwell again, an apt description of the response to the Two Minutes Trump Hate:

A hideous ecstasy of fear and vindictiveness, a desire to kill, to torture, to smash faces in with a sledgehammer, seemed to flow through the whole group of people like an electric current, turning one even against one’s will into a grimacing, screaming lunatic.

Well, not quite that bad, don’t know about kill or torture, but the desire to punch Trump or his supporters in the face runs deep on the left and was clearly expressed in that crowd.

The election was eventually won by the Clinton/Obama candidate, Tom Perez, rather than the Sanders/Warren candidate, Keith Ellison. Didn’t matter much, Perez named Ellison as Deputy Chair.

Curious about Perez’s policies, I looked him up. Among other things, he supports eventually raising the Federal minimum wage over the next few years to $15 per hour. Here’s a few quotes from Perez about the question:

Raising the minimum wage to $10.10 will benefit about 28 million workers across the country. And it will help businesses, too – raising the wage will put more money in people’s pockets, which they will pump back into the economy by spending it on goods and services in their communities.

President Obama believes that income inequality is one of the most pressing matters facing the nation. If we are going to be a country that provides ladders of opportunity and believes in a thriving middle class, then we have to raise the minimum wage.

Given those huge benefits of a rise in the minimum wage to ten dollars per hour to the poor, the middle class, businesses, and the economy as a whole, I can see why DNC Chair Perez wants to raise the minimum wage to fifteen dollars per hour. Obviously, if what he says is true, raising the minimum wage higher than ten bucks an hour would benefit even more workers than the twenty-eight million he cited.

Plus if raising the minimum wage to ten an hour helps businesses, it would clearly help businesses even more to raise it to fifteen dollars per hour.

And this in turn reminded me of my proposal to end American poverty forever that I came up with a few years ago. I hadn’t realized just how simple it would be to bring everyone up to not just a decent but a comfortable standard of living. I mean, it’s the 21st century, hard-working Americans should all be at least comfortable. Here’s my truly brilliant scheme to aid the poor, the middle class, businesses, and the economy itself:

=====================================================Raise the minimum wage to $75 per hour.=====================================================

I mean, think about it. First off, it means that every working person in America would be making at least $75 per hour. Talk about helping millions of workers! Most people make less than seventy-five an hour, it would help all of them. Everyone in the US, even the janitors and the kids at McDonalds, will be earning at least $150,000 per year.

Of course, that $75 per hour is money which those previously poor folks will, what was it … oh, right, “pump back into the economy by spending it on goods and services”. Just think about how pumping those millions and millions of dollars into the economy will help the businesses! People will have so much spending money, the businesses will laugh all the way to the bank. Consumer demand will go through the roof.

And as to helping the economy, if the previously poor are making $150,000 per year, then imagine what the middle class will be making. All we have to do is to climb up Obama’s “ladder of opportunity” and it will boost the middle class and lift the entire economy!

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… now, if you understand the problem with my brilliant plan, if you can see why this method cannot possibly work … then you need to admit that the exact same argument applies to ANY minimum wage, even a very low one.

And if you don’t understand the problem with my brilliant plan, then you might be a liberal.

The issue, of course, is that regardless of what the law says, in the real-world marketplace of labor there are some people who are only worth six bucks an hour, or nine bucks an hour, or three bucks an hour. I wrote elsewhere about how on my first job as a teenager I made a quarter of the minimum wage. Why?

Because that was all I was worth.

The real minimum wage, of course, is zero. If we set the minimum wage at $15 per hour as Tom Perez and the Democrats argue, everyone who is not worth $15 per hour in the marketplace will be out of a job … and as a result they will make the real minimum wage, $0.00 per hour.

The minimum wage law does not create any wealth. Instead, all the minimum wage law does is redistribute the amount of money spent on wages. It removes money from less skilled lower-paid workers and puts the money toward more skilled higher-paid workers … while increasing the pressure for automation at the bottom end.

So here’s the Perez plan, the Democratic Party’s plan. Take money away from the lowest-paid worker, give that money to the higher-paid workers, push automation (think hamburger-making machines), and pretend that the redistribution of wealth is a net gain for the economy …

Have I mentioned how happy I am to have a President who understands that we can’t redistribute our way out of the economic hole we’re in? America dodged a big bullet …

All the best to all the best,

w.

PS: Could everyone please QUOTE THE EXACT WORDS YOU ARE DISCUSSING, so that we can all understand what you are discussing.

I can almost see them salivating right now.
I’ll bet most governors and governments would love to see every worker paying the taxes for $75 /hr.
The coffers would be overflowing.
Medicare, Medicaid and SS would be saved. (15% X $75 /hr = $11.25 /hr)
$11.25 for every minimum wage worker for every hour they work.
Never mind their regular income taxes both state and federal.
As one whose government job is to spend OPM, I think you’d might lie and act stupid to get your hands on that kind of easy money.
Of course, as we know, you could build a lot of robots for $75 /hr and pay zero benefits.
Collateral damage? Unintended consequences? Who knew?

When I was a kid, I watched the bakers make donuts in the bakery window. They cranked the machine that dropped donut batter into the hot fat, then they turned them over with a wooden stick when half done, and finally took them out one by one onto a drip tray. In a few minutes the baker had a couple dozen donuts ready to sell.
The other day I watched them make donuts at Krispy Kreme. Full automation! Push a button and the machine starts and does it all. In a few minutes there were several hundred donuts ready to sell.
Just like the hamburger machine.

I suspect you’ve already seen the Washington Post has hired John Podesta. The irony is in this quote from the article about him:
“No one knows more about how Washington works, how the White House operates, and how policy ideas are translated into reality than John Podesta,” Editorial Page Editor Fred Hiatt said. “His long experience in Congress, inside two Democratic White Houses and on the front lines of numerous presidential campaigns, will offer readers vital insight into Washington and politics at the start of a new era.”

Wow did you cover a lot of ground in this post. First off regarding your 1984 quotes. I have seen too many other events in the past few years that have eerily resembled parts of 1984.. ” The one quote that has been most chilling for me is: “Orthodoxy means not thinking–not needing to think. Orthodoxy is unconsciousness.” The coverage of climate change is definitely driven by this.. I just hope those in the science community reclaim the scientific method.. so I am rooting for the Spencer’s, McIntyre’s,Watts’, and you and others to bring it back into vogue..

So to get back on topic.. regarding the minimum wage.. yes automation will replace a lot of workers if the minimum wage goes up.. in addition in those areas where you cannot innovate there will be wage scale compression, which means all the wages up the wage scale are raised to maintain the ranges..

As an example: I was the CEO of a large non-profit in California that provided after school child care.. none of the program or supervisiory positions are suseptible to automation.. being in CA meant that the minimum wage kept being pushed up.. this program was also regulated by the state so we had to meet specific staff ratios and also ratios of differing qualified staff.. our aides were minimum wage, and the next level were teachers, and then directors..

When the minimum wage goes up the aides make more.. well to maintain the next level of teachers their salary needed to also be adjusted up to recognize the added qualifications and responsibilities (we also had three levels of teachers based on credits and experience so they too were raised), then the directors salaries also had to be adjusted up.. this compression moved all of the salary ranges upward.. what was the end result? Child Care cost more for the parents who needed the program.. if you multiply this across the economy you get higher wages and increased costs for goods and services.. while automation may change the slope of the price trajectory it won’t change the direction.. so in the end we end right where we started.. those at the least skilled positions have no more buying power than they had when the minimum wage was lower.. or now in the age of automation there are fewer low skilled positions…

Glad you are watching the party confabs.. I gave up as both parties have become more about staying in power.. so to that end I will end with another 1984 quote: “The Party seeks power entirely for its own sake. We are not interested in the good of others; we are interested solely in power, pure power.” And that may be why the Dems worked so hard against Bernie, and the Reps did the same with Trump..

Cheers.. looks like snow tonight so tomorrow will be a great ski day…..

outside of government (which shools qualify as) and union shops, when the minimum wage goes up, it doesn’t mean that everyone gets a raise, it just means that the people who had earned raises above minimum wage see most of their gais vanish, without any decrease in their responsibilty.

Eventuallty, things will change (as people won’t be interested in going after the higher jobs with more responsibility without much additional pay), but it takes years, by which time there will be another cdall to increase the minimum wage.

Davidlang.. how long do you think a supervisor will stay in their job when those they supervise are making what they make? Wage scale compression is a fact for any corporation that that has a defined wage and salary program with defined ranges and they will suffer from range compression.. it has little to do with unions or gov’t wage scales.. most all mid sized or large enterprises have wage and salary plans that have ranges based on positions in the organizations.. so when the lowest range is raised it compresses the next range, forcing presssure to increase the next range, and so on.. since most range differentials are percentage based the compression creates a greater dollar discrepancy as you go up the ranges.. and since in most service based organizations labor makes up the greatest percentage of the their expenses, a minimum wage increase will cause that organization to raise their prices to cover the increased cost of their labor costs…

I’m saying that it compresses the next range, and that doesn’t automatically translate into increases for the ranges above that. Union shops have pay per tier tied to X times minimum wage, and government jobs are frequently tied to some multiple of minimum wage.

But in large companies, only the lowest paying jobs are even remotely tied to minimum wage, everyone else gets hired at the going rate and then gets raises that are based on a percentage of their prior pay and their performance. This is frequently less than the increases in the going rate for those jobs, so someone who is at a job a long time ends up being paid less than a new hire at the same job.

In the tech world, it’s slowly being recognized that management is a very different skill set than other tech jobs, and as a result, instead of pushing good technical people into becoming bad managers, they are finding that mangement is a different track, and it’s becoming far more common for the managers to be paid less than the experienced people they manage.

Art, regarding wage compression – strange choice of terms to me for it is supposed to be – if a corporation is in a competitive industry, there will be no boosting of wages up through the ranks. Doing so will raise the cost beyond the competitive price point. Get real. As you said, you pass the costs on to the service purchaser, but if you have priced yourself beyond what the service purchaser can afford, they find a replacement, even if it is “under the table” to the next door neighbor on welfare.

What raising the minimum wage does is it makes believe that “entry level” jobs, the type that teenagers and retirees used to fill, are now priced beyond their need. What happens is the job goes away, someone else will get the opportunity to work harder to make up for the difference, and there will be more people needing welfare. To try to raise the entry level/part time job to a “living wage” instead of creating jobs that ARE intended to provide a living wage makes no sense.

But the real problem of raising a minimum wage – a wage intended only for part time jobs and entry level positions – is that it doesn’t raise the income of those on fixed incomes. It is a fact that a 25% wage increase is going to impact cost of living. It is also a fact that retirement income, as an example, won’t get more than 3% or so as a COLA. That means that retirees who are not drawing welfare assistance will be forced into doing so just to survive. No matter how hard we look at minimum wage increases, each time they go up, more people end up on welfare and out of the workforce. Hardly a way to build an economy or to foster income equality. but braindead liberalism can’t see that because, well, what was that term – orthodoxy? Fits perfectly.

Tom O ” No matter how hard we look at minimum wage increases, each time they go up, more people end up on welfare and out of the workforce.”
The problem is, to the democrats that’s not a bug, it’s a feature. That’s called a win-win.
Raise min wage and all those people either get a raise or lose their job and need unemployment or welfare assistance. Either way, they they see the dems as providing both.
The next part, as Art says, is that all wages rise, then all costs rise with the net result of no benefit…except for Uncle Sam. He gets a bigger cut as everyone is being pushed into a higher wage bracket and higher costs mean higher sales tax revenue as well.
Heads I win, tails you lose.

your cpommetnis insightful and thoughtfu.
i have one wuestion…
Why did directors’ compensation have to be increased becasue aides and teachers received raises?
Did you and your cadre of executive managers need reaffirmation of your relative worth?

The minimum wage is not as important as a “safety net”, promoted by Nancy Pelosi. Why the hell should you work when food, accommodation, and education are basic rights? This creates a welfare class, much richer than people working for a minimum wage. I know a lady who works as a housekeeper. When she goes shopping, she sees neighbors buying stuff she could not afford – with food stamps.

It’s not supposed to. It’s supposed to create Democrats. Just like Obama Care was designed to fail by trapping people [i.e. future Democrat voters] into a government run, single-payer nationalized health care system.

The Dems know that minimum wage not only doesn’t work (except maybe Bernie, he seems especially stoopid) but does the exact opposite of what it intendeds.

But any lie in furthering the future of the coming glorious People’s Republic is acceptable, is it not Comrade?

WE, your certitude is maybe admirable, but certain it is not. That ‘on average’ higher wages will lower unemployment is uncertain. Not just that hamburger flippers will be replaced by robots (former labor sec nominee example). Another example is housing framers as pre fab sections takes share. And many other similar examples. Productivity marches on. Some unproductive people do not, to their detriment.. Darwin in another form.

The intent of automation has always been to eliminate the need for population. Of course the braindead that push it forget that without population, there is no need for production. If no one is earning value, there is none to transfer for product.

I can picture it now. Assembly robots producing products that move off the assembly line on to a conveyer that takes it straight to a robotized metal shredder that rips it into component parts, sends those on to conveyers headed to robotized fabricators that send their output to the robotized assemblers to create products. A perfect world.


Back in the early 1960s IBM sold data processing and early mainframes as a way of replacing the vast number of accounting clerks necessary to keep track of the business. So, businesses installed the equipment and eliminated many clerk positions. Pretty soon, management discovered how valuable the new data processing (DP) generated reports were to their decision making and started demanded more. Of course they had to hire back some of the clerks to assemble the data for the new reports. Pretty soon they now had more clerks than before but were getting over twice the information to run the business. Automation had actually increased the number workers but the businesses now ran more efficiently. It wasn’t long until no one sold data processing as a way to eliminate employees, only as a way of improving efficiency of both management and the business.

Speaking as a retired software engineer, what ‘automation’ did was (a) to make simple-minded jobs (e.g. auto assembly line) disappear, (b) make it easier for skilled people to do better (or more), and (c) give lots of jobs to programmers like me! But down here in South Africa, with about 40% unemployment, appalling education, huge vacancies for skills (see the relevance?), the Socialist ANC government has just introduced a minimum wage. It’s still cruddy, but there are/were still small jobs for badly educated people to do – and what’s going to happen to those minor jobs if employment gets too expensive? Ah well, with Zimbabwe or Venezuela as modern exemplars of Socialism for the Government to emulate – who knows?

I hope the ANC’s minimum wage isn’t just the first turn down a bad road. Here in the states when the cost of labor eliminates jobs both unemployment and the welfare roles go up hand-in-hand. These are followed shortly by increased hard drug use. It appears that when it’s easier to draw welfare than it is to work and the income is about the same, or in some cases here in the states, greater, family life is destroyed and people start turning to hard drugs. It’s a slippery slope, all caused by wanting to feel good and help people.

As usual, I find that I agree with both you and Willis. The world is a result of a complex evolution. You may be tempted to radically improve on an existing order – it sometimes works, but mostly not, as survivors from Germany, USSR, China, North Korea, and Cambodia could confirm. I believe that Willis’s proposed $75/hr minimum wage is at least as reasonable as many proposals by Sen. Bernie Sanders (independent) or Sen. Elizabeth Warren (Cheyenne, Democrat), and argued better. Of course, it is simply a proposal to devalue the dollar by some 80%, and it would also solve problems with our national debt.

It reminds me that Communism was first proposed by Dr. Marx and Dr. Engels – excuse me, I am wrong, real doctors would try it on animals first.

As usual, I find that when people impolitely ignore a request to QUOTE THE EXACT WORDS YOU ARE TALKING ABOUT, it ends up as just that kind of useless gibberish. Just what do you agree with me about? I get very nervous when people say “I agree with Willis” and they DON’T SAY WHAT THEY’RE TALKING ABOUT!

Nor do I have any clue who the “who” is who you say you also agree with, or what you agree with this mystery person about.

It gets old, amigo. Pointing out over and over that people on the other side of the computer screen can’t read minds gets very old … QUOTE THE EXACT WORDS YOU ARE DISCUSSING, or I’ll just toss your comment deservedly into the bit box for recalcitrance, figuratively of course.

A perfect example. Wendy’s has announced plans to instal 1,000 burger vending machines this year. Franchisees are pushing for them to reduce their labor costs. At $15,000 for 3 machines, a franchisee can recoup the cost over two years. Of course, that feeds (if you’ll pardon the pun!) straight into their bottom line as they won’t reduce the price the consumer pays.

The really stupid thing about this minimum wage ‘debate’ is that minimum wage is not supposed to be something for the sole breadwinner in a family, it’s supposed to be the high school summer/part-tim job, or first job out of high school.

by making it so expensive to hire people, these jobs get eliminated (and become ‘extra duty’ for the regular employees. This leads to people working ‘under the table’ or not working at all until they get out of school.

Look what happens in Sweden!
No low salaries are accepted by workers union.
Many refuges are accepted in Sweden by government.
Result high unemployment in that group (20-40%) compared to natural Swedes (3-4%)
Generous system of benefits is distributed, but still working is more fortunate.
Income spread is widening.
And look what happens.

“Oh, I thought you were trying to build a canal. If it’s jobs you want, then you should give these workers spoons, not shovels. [Reply to the government bureaucrat of one Asian country who told him that, reason why there were workers with shovels instead of modern tractors and earth movers at a worksite of a new canal, was that: “You don’t understand. This is a jobs program.”]”

The debate among actual economists about the minimum wage was won, by Friedman, with the introduction of the idea of the Negative Income Tax (implemented as the US IRS “Earned Income Tax Credit”) Rather than require a subset of the economy to bear the costs of paying “a living wage” (Which I see as Floyd Lawson, Emmett Clark, Sam Drucker, and Fred Ziffle all voting that Oliver Wendell Douglas must be compelled by Sheriff Andy Taylor to give his hired man “Eb” a raise) that everybody will chip in on taxes and the guy at the bottom gets a bigger “refund” than he paid in. This accomplishes the social goal (and sets aside the question of whether it’s a desirable goal) but “socializes” the cost.

65 million people, primarily in urban areas with failing schools
….are OK with people going back on their word, deleting 33,000 public records,
….lying that “the video” caused the death of several people the person was responsible for.
“The buck doesn’t stop here! (but in my pocket)” is their chant.

Oh, don’t forget the DNC chair that you mentioned (Donna Brazil) was herself a replacement for Debbie Wasserman Schultz who disgraced herself by conspiring against Bernie Sanders in the primaries.

The problem with your $75 an hour proposal is that those greedy capitalists will just go out of business instead of managing to pony up the money. Obvious solution is that the government will have to force them to stay in business or go to jail (it’s working in Venezuela). The government will then nationalize those mom and pop businesses after they jail the anti-progressive owners and subsidize the workers by printing money to make up for any shortfall caused by the anti-progressive populace that won’t pay $100 bucks for a hamburger (assuming there is any hamburger). Of course that $75 will be worth about 7.5 cents by that time (or even a fraction of that) once hyper inflation kicks in.

I’m sometimes amazed at youngsters who make minimum wage or a bit above but who still manage to have an iPhone with contract and cable TV. I can certify from two of my off spring that a lot of money doesn’t necessarily mean much as they both make over $100,000 take home and still manage to be mostly broke (or so they claim) and that in OK & KS where the cost of living is very reasonable. Both families have a tendency to waste money like gamblers except they neither gamble nor drink and of course they apparently don’t have a clue as to where it goes. Suggested a budget and reviewing records but to them that would be too much effort.

I know. I’m a pedant. My job involves finding problems with things. So I can never be happy with what looks like an inaccuracy to me – even if it has no effect on the main argument (sometimes ESPECIALLY if it is irrelevant to the main argument…). I suppose that’s why I was attracted to the Global Warming debate so early…

Now the original quote talks about the population being enjoined to hate a traitor – who may be a made-up figure – and whose location is a mystery, He may be hiding with our enemies; he may even still be in our own country – Oceania. Oceania is the power-bloc that Winston Smith lives in, roughly comprising the Americas and the British Empire. (Eurasia is essentially Russia and Europe – Eastasia is essentially China.)

So if you wanted a direct transfer of the quote, It would refer to Trump, not Goldstein, and America, not Oceania….

In the UK, Willis, the ‘minimum wage’ has now been morphed into the ‘living wage’ – the idea of the right-wing of the Tory party! Not to be out-done, the socialists under Jeremy Corbyn started to flog the idea of a ‘maximum wage’. They got into trouble with that when they discovered that professional footballers can be on £10-15 MILLION a year! So they decided to exempt footballers (‘cos socialists like to think they’re all on their side). You couldn’t make it up.
Fortunately, the chances of Corbyn ever getting into office are so slim it’ll never happen.

Some years ago here in Germany we had fully trained hair dressers in East Germany paid only 3.50 €/hr. Now then we got a minimum wage of 8.50€/hr.
There was an evaluation, but there were no job losses in general, and the number of jobless is at the lowest ever rate for 50 years.

Getting 3.50€/hr is lower than the estimated income for surviving, and you have to ask for federal support. Even the drivers of parcel services got only 5 €. Now they have 8.50 € and we saw no increase in prices, and Amazon did not go bust.

For comparison, my wife is a non-academical clerk in the industry a earns 25€/hr. If you make your high school and after that a 3 years apprenticeship with 250€/month. And then to get as a hair dresser only 3.50€, it is just not fair.

Not to talk about CEOs, busting big companies and after that getting some extra millions allowance. Sorry, that is theft.